N.Y. Laws » CHAPTER Tax / ARTICLE Real Estate Transfer Tax
New York Consolidated Laws

N.Y. Tax Law § 1404 (2026)

Liability for tax

✓ current as of May 2026
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§ 1404. Liability for tax. * (a) The real estate transfer tax shall be
paid by the grantor. If the grantor has failed to pay the tax imposed by
this article at the time required by section fourteen hundred ten of
this article or if the grantor is exempt from such tax, the grantee
shall have the duty to pay the tax. Where the grantee has the duty to
pay the tax because the grantor has failed to pay, such tax shall be the
joint and several liability of the grantor and the grantee.
  * NB Effective until July 1, 2021
  * (a) The real estate transfer tax imposed pursuant to section
fourteen hundred two of this article shall be paid by the grantor and
such tax shall not be payable, directly or indirectly, by the grantee
except as provided in a contract between grantor and grantee or as
otherwise provided in this section. If the grantor has failed to pay the
tax imposed by this article at the time required by section fourteen
hundred ten of this article or if the grantor is exempt from such tax,
the grantee shall have the duty to pay the tax. Where the grantee has
the duty to pay the tax because the grantor has failed to pay, such tax
shall be the joint and several liability of the grantor and the grantee;
provided that in the event of such failure, the grantee shall have a
cause of action against the grantor for recovery of payment of such tax,
interest and penalties by the grantee. In the case of a conveyance of
residential real property as defined in subdivision (a) of section
fourteen hundred two-a of this article, if the tax imposed by this
article is paid by the grantee pursuant to a contract between the
grantor and the grantee, the amount of such tax shall be excluded from
the calculation of consideration subject to tax under this article.
  * NB Effective July 1, 2021
  (b) For the purpose of the proper administration of this article and
to prevent evasion of the tax hereby imposed, it shall be presumed that
all conveyances are taxable. Where the consideration includes property
other than money, it shall be presumed that the consideration is the
fair market value of the real property or interest therein. These
presumptions shall prevail until the contrary is proven, and the burden
of proving the contrary shall be on the person liable for payment of the
tax.
Notes of Decisions
Cited in 6 cases (3 in the last 5 years), 1993–2026 · leading case: Nesbitt v. Penalver, 40 A.D.3d 596 (N.Y. App. Div. 2007).
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Nesbitt v. Penalver, 40 A.D.3d 596 (N.Y. App. Div. 2007). “Similarly, liability for transfer taxes is defined, in the absence of an agreement to the contrary, by law (see Tax Law § 1404), as is the risk of loss (see General Obligations Law § 5-1311).”
Heller v. State, 611 N.E.2d 770 (N.Y. 1993). “Tax Law § 1404 (a) imposes primary liability for payment of the real estate transfer tax on both the grantor and the grantee of real property and states that the transfer tax "shall be paid by the grantor * * * [and that] the grantee shall have the duty to pay the tax [if the…”
Hsbc Bank USA, N.A. v. Rosa, 2026 NY Slip Op 01188 (N.Y. App. Div. 2026). · cites it 5× “which were to void a certain provision of a terms of sale agreement directing nonparty September Buying Group, LLC, to pay transfer taxes, recording fees, and for deed stamps in connection with the sale of the subject property and to direct a referee to pay the transfer taxes,…”
Bd. of Mgrs. of Graceline Ct. Condo. v. Ansary, 2024 NY Slip Op 30027 (N.Y. Sup. Ct., New York Cty. 2024). “e Referee, who shall deposit it in accordance with paragraph "Fifth" above; and it is further ORDERED that all expenses of recording the Referee's deed, including real property transfer tax, which is not a lien upon the property at the time of sale, shall be paid by the…”
U.S. Bank Nat'l Ass'n v. Chenango Place, LLC (N.D.N.Y. 2025). “e Referee, who shall deposit it in accordance with paragraph "FIFTH" above; and it is further ORDERED that all expenses of recording the Referee's deed, including real property transfer tax, which is not a lien upon the Property at the time of sale, shall be paid by the…”
CBS Corp. v. Tax Appeals Tribunal, 56 A.D.2d 908 (N.Y. App. Div. 2008). “In the absence of a statutory definition of the phrase “beneficial ownership” (Tax Law § 1405 [b] [6]) or meaningful guidance in the applicable regulations regarding these circumstances (see 20 NYCRR 575.”
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